(CLO) If the US withdraws from NATO, Europe will have to protect its own security at a high price.
Europe is worried about a secret deal between US President Donald Trump and Russian President Vladimir Putin to end the Ukraine crisis. Regional leaders fear Mr Trump could withdraw US military protection, forcing Europe to take matters into its own hands.
Britain responded quickly by pledging to increase its defense budget to 2.5% of GDP by 2027. In Germany, Friedrich Merz's CDU/CSU and Chancellor Olaf Scholz's SPD agreed to loosen borrowing rules to create a special fund worth 500 billion euros to upgrade infrastructure and the military.
Illustration photo: European Defense Agency
For decades, Europe has relied on the United States as the backbone of NATO. Now, the threat of a US withdrawal is forcing countries to rethink their approach. European countries will have to spend hundreds of billions of euros a year to replace American military power, including building up intelligence, command and control and deployment capabilities.
Bruegel economists estimate that to offset US military aid to Ukraine, the EU would need to increase its GDP by just 0.12%, but if it wanted to be fully self-sufficient, that figure could rise to 3.5% of GDP – or about €250 billion a year.
The European Commission has proposed an €800 billion REALM Europe plan to boost defence capabilities without violating strict financial rules. Several financing options are being considered, including using the European Investment Bank (EIB), issuing joint bonds or creating a new “re-arms bank”.
Beyond security concerns, experts say defense spending could boost the region’s economy. If the military industry grows, it could offset the impact of U.S. tariffs on European cars. But whether or not there are economic benefits, Europe is facing a reality: if it wants to be safe, it has to pay for itself.
Ngoc Anh (according to DW, Bruegel)
Source: https://www.congluan.vn/chau-au-se-ton-bao-nhieu-de-tu-phong-thu-neu-my-rut-lui-post337501.html
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